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The hand that feeds you

When it comes to violating welfare rules, recipients are “damned if they do and doomed if they don’t"

When Candice Lynn Heath committed welfare fraud at her caseworker's suggestion, she had no idea how dire the consequences might be.L. to R.: Pittsburgh County Sheriff's Office; Joe Raedle/Getty Images

David Heath met his second wife, Candice Lynn, at the drive-through tobacco kiosk where she worked. “That’s a nice-looking vehicle,” Candice had said, as she passed him his change for a tin of snuff. Her dark hair and deep brown eyes reminded David of a woman he had seen in a dream, and he invited her out for a drive that night. Neither of them had ever lived anywhere except McAlester, Okla., a windswept town of 18,000 people in the southeastern corner of the state; its major landmark is the state penitentiary that Tom Joad leaves at the beginning of The Grapes of Wrath, and that today hosts a prison rodeo, an event commemorated at the town entrance with a bronze statue of a mustang bucking a cowboy in a jailbird costume. It turned out they had once lived on the same street and Candice had babysat for David’s neighbors. “We just clicked,” David says. Four months later, they married in Fort Smith, Ark. After they were pronounced husband and wife, David lifted Candice in the air and shouted, “I’m the luckiest man in the world.”

Money-wise, things weren’t so lucky. David says he was paying nearly $800 a month in child support for three kids from his first marriage while earning just under $40,000 a year at the plastics plant. Candice had three children of her own, but custody of only the youngest two — an 18-month-old girl and a 4-month-old boy; her 7-year-old son lived with his dad in town. Candice, 25, was 10 years younger than David, but suffered from a number of health issues. She had taken insulin for diabetes since childhood. Her heart beat abnormally and her kidneys were prone to failure. She jokingly warned David not to be surprised if she were in the hospital 30 weeks of the year. It only encouraged him. “I didn’t care what she had going on,” he says. “I was thinking, I can help her take this burden off.” She and her two children moved into David’s mobile home on the outskirts of town. Two months later, she was pregnant.

They relied on David’s paychecks, though Candice did her best to contribute — crafting velveteen bows and mending dresses for friends and neighbors, all while taking courses to become a nurse’s assistant. But the family soon fell behind. The pantry was empty in the days before payday, and dinner became a sad exercise in stretching out a can of soup. Candice, about three months pregnant, finally revealed that she had an Oklahoma EBT card from when she was single that was debited $426 each month in federal food assistance. David had never seen a welfare application, but he welcomed the help. “Food stamps didn’t make us wealthy,” he says. “Food stamps help feed your kids. Not totally feed them, but help feed them.”

Welfare recipients are responsible for notifying caseworkers of any changes to their household size or income, but Candice had only reported her marriage a year after the wedding, following the arrival of their new son. The Oklahoma Department of Human Services (OKDHS) determined David’s income was too high for the family to receive benefits. The income threshold for the Supplemental Nutrition Assistance Program (SNAP), formerly known as food stamps, is about $35,000 a year for a family of five, and does not factor in custody payments. One caseworker suggested to Candice that she get a divorce.

“When she told me about that it was like somebody freaking stabbed me. I thought he was hitting on my wife,” David says. He stopped working overtime, but his base monthly pay was still about $150 too much. “That’s when the 45-day deal came in,” David says. Separated single parents with little means of their own can rely on public assistance to escape undesirable relationships. A caseworker said if Candice and the children lived apart from David for 45 days at a time, it would appear on paper that the couple had split. They certainly didn’t like the idea, but David and Candice needed help buying food, so Candice and the kids moved in with her mother.

Candice’s mother, Patricia Coon, lives with Candice’s stepfather in a slouching one-story home on the west end of McAlester. In the unpaved driveway, a rusted pickup, seemingly parked there since the Carter administration, sits beside a dusty, fenced-in dog run. Coon is in her early 50s, but appears much older, with bone-white hair, a furrowed brow and deep grooves around her mouth. The children, whom Coon invariably calls “my grandbabies,” took the spare bedroom. Candice slept on the couch. It was an unorthodox arrangement for a recently wed couple with a newborn, but the change of residence and no reported income returned monthly debits to Candice’s card. “I mean it's not like we didn’t have any interaction or nothing. It was just that they told us what we need to do, so we done it. I sat on my phone until late hours in the night and she went to sleep,” David says.

Since the start of the recession, the number of SNAP recipients has nearly doubled to 47 million people, who survive on an average household income of $9,000 a year. With an annual budget of $76 billion, it is the second-largest means-tested program in the country, after Medicaid, and many times larger than Temporary Assistance for Needy Families (TANF), which provides cash for about 4.5 million people at an annual cost of $16.5 billion. “I’ve been promoting access to the program because it is designed to be responsive to what’s going on in the economy,” says USDA undersecretary Kevin Concannon, who oversees SNAP. During the recession, the program has helped 8 percent of households climb out of poverty, and eased the depth and severity of poverty by over 20 percent for all beneficiaries, which for Candice and David meant knowing the basics, like bread, noodles and meat, would always be in the house.

Neither SNAP nor TANF adjust eligibility levels based on local costs of living — David’s salary would have been too much whether he lived in McAlester or Queens, New York — and SNAP doesn’t cover a number of household necessities, like soap, toilet paper, pharmaceuticals and diapers. A 2008 study in San Diego found that the average annual income of people convicted of welfare fraud, when researchers factored in every penny, including all public assistance and unreported earnings, was $13,356. To make ends meet, many SNAP recipients have to supplement monthly benefits — about $133 per person — with ad hoc work or by housing a partner or relative, and hide the additional income from authorities. “Everybody has to do something that makes them a criminal,” says Kaaryn Gustafson, a law professor at the University of Connecticut and author of Cheating Welfare: Public Assistance and the Criminalization of Poverty.

Candice and David knowingly skirted the law, but given how readily their caseworker suggested the wily subterfuge, they were unprepared for how dire the consequences could be. According to Gustafson, “When it comes to violating the welfare rules, most welfare recipients are damned if they do and doomed if they don’t.”

In early 2011, nearly a year into their “separation,” the father of one of Candice’s children called to say he could no longer care for him. Candice might have expected it. Her child had landed in foster services twice before. Friends had told her things at the house were in disarray. No one could completely rule out the possibility of abuse. Her request for custody was assigned to a DHS caseworker named Lisa Comer, who said she would look into it. Weeks passed without word and Candice grew frantic. “That’s all she talked about,” David says. “‘What can we do? What can happen?’” The transfer was finally processed three months later, and only after Candice spoke with Lisa Comer’s supervisor. Candice and her three children moved back in with David.

At her next visit to OKDHS, an investigator named Christopher Comer pulled Candice and her mother into his office. With an annual budget of $5 million, Oklahoma’s inspector general employs 30 deputized welfare fraud investigators — fully sanctioned law enforcement officials carrying badges and guns. From behind a large wood-topped desk, Agent Comer looked at Candice and said, “That was my wife that you reported.” Apparently, Lisa, his wife and Candice’s caseworker, had been disciplined for her handling of her child's case. Then he told them that Candice was committing food stamp fraud by living in two residences. Candice tried to explain, but Agent Comer said he had all the evidence he needed to convict her. “What are we supposed to do about this?” Coon asked. He told them to get their food stamps, and the two women left the office shaken and confused.

Court records show that in January 2010, DHS received an anonymous tip that Candice was committing fraud, but Agent Comer only began his investigation into Candice’s case in April 2011 — a month after she appealed to his wife’s supervisor, and just days after the meeting in his office. The inspector general of Oklahoma, Tony Bryan, told me a referral management unit housed at OKDHS headquarters in Oklahoma City reviews all tips. The unit sends worthy cases to county supervisors, who assign investigations to local agents. (The Office of Inspector General at OKDHS refused multiple requests for an interview with Agent Comer, and its general counsel denied an Open Records request for the investigation report.)

On a balmy evening in July, Coon was watching sitcoms with her husband when she heard her golden retriever barking out front. In the days after meeting Agent Comer, Coon had joked to her sister-in-law, “Well, I guess I’ll just wait for them to come arrest me.” Still, her heart dropped when she squinted through the screen door and saw three men — two wearing suits, the other a sheriff’s uniform — pass through the gate.

A fraud investigator flashed a search warrant that read, “There is now being concealed certain properties which are evidence of a crime.” Coon looked on from the kitchen table as the men flitted about her three cluttered rooms, snapping pictures. After completing their search, the man with the warrant approached Coon with a blank sheet of paper and a pen. “He had me write out a statement that it was just my husband and I living here,” Coon says. As soon as she signed her name, the agent called over the radio, “Go for it.”

David’s trailer is down a secluded dirt road, eight miles from Coon’s house. When Agent Comer, another investigator and a sheriff's deputy arrived, David was sitting on the porch, while three kids played on the patchy lawn. The couple had heard about the search at Coon’s house an hour earlier. They knew what Agent Comer meant when he asked, “Who lives here?”

“I don’t know the definition of living here anymore, but she’s standing right there,” David said, as Candice emerged from the kitchen.

Agent Comer strolled up the steps. “Exactly,” he said

The other agent suggested David take the kids inside, while they arrested Candice for welfare fraud. David exhaled deeply, perhaps with an elevated note of frustration.

“Hey, you need to calm down!’” the agent said. The deputy took a step forward.

David was speechless. “I just looked at them and thought, ‘What are you doing?’”

Candice kissed him. The sheriff’s deputy drew her away and cuffed her. She was booked on two counts of felony fraud; bail was set at $25,000. The bondsman required a 10 percent fee. “I gave him a check for a thousand dollars and, oh yeah, it bounced like you wouldn’t believe,” David says. They agreed to a monthly payment plan with interest. After three nights in jail, Candice came home.

To go after folks that are desperate and hungry is really not good government policy. - Marc Cohan, National Center for Law and Economic Justice

Every year, states conduct nearly 450,000 welfare fraud investigations. About 14,000 people are eventually criminally prosecuted for welfare fraud, most of them charged with felonies. (As a comparison, the IRS launches about 5,000 fraud cases each year, and about half of them end in convictions.) Some states are more efficient investigating welfare fraud than others. In 2011, Delaware found evidence of potential fraud in just 15 of 60,000 investigations; California found potential problems in fewer than 2% of its 150,000 SNAP investigations, costing the state about $35 million to find less than $20 million in wrongful payments. All told, the USDA contributed $126 million, and states spent millions more, for investigators to recover about $115 million. “The USDA needs to investigate whether or not the aggressive enforcement is inconsistent with the overall goal of the program,” says Marc Cohan, director of litigation at the National Center for Law and Economic Justice. “To go after folks that are desperate and hungry is really not good government policy.”

A handful of locales have adopted welfare fraud diversion programs to reduce the economic impact of criminal prosecutions; some states, like Arkansas and Wisconsin, have opted not to criminally prosecute welfare fraud altogether. Oklahoma’s policy is to prosecute every case it can. In 2011, investigators launched 3,881 probes, discovering 416 “post-certification positives”— the industry term for evidence that might lead to a disqualification — but more than 500 people were prosecuted for SNAP fraud in the state, suggesting that prosecutors sometimes tack the charge on to other crimes.

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Welfare programs in the United States have always been expected to distinguish between the deserving and the undeserving poor, and on factors other than financial need. The Social Security Act of 1935 instituted the first federal system of poverty relief for children, but the bill also allowed states to adopt “suitable-home laws,” which revoked the grant for children of unmarried mothers who lived with a man or had a child out of wedlock. After World War II, as African Americans fled the Jim Crow South, and the number of all races and ethnicities on welfare grew, local welfare agencies conducted “man in the house” searches — midnight raids to catch unmarried women with men in their beds — until the Supreme Court ruled the practice unconstitutional in 1968.

In 1976, Ronald Reagan began a 20-year project to smear welfare recipients. He spent much of his failed run for the presidency that summer harping on the extraordinary case of Linda Taylor, a seasoned grifter from the South Side of Chicago, who created multiple aliases to defraud welfare. On the campaign trail in 1992, Bill Clinton promised to “end welfare as we know it,” and the Newt Gingrich Congress that arrived in Washington two years later, most of them self-identified Reaganites, took him at his word, and then some. The Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA), passed in August 1996, allowed states to independently set various restrictions on cash assistance, like prohibiting benefits to unwed mothers under the age of 18 and forbidding increases to women who have children while receiving welfare. In some states, a household can lose benefits if any member is convicted of a drug charge. In others, a family’s benefits are revoked if a child misses too many days of school. As in David’s case, eligibility ignores the income a parent devotes to child support, but calculates it as income for those who receive it. “There was a qualitative transformation, a windfall of ill will, that presented a political opportunity to create a climate to chase people away from their entitlements,” says Sanford Schram, a professor of public policy at Bryn Mawr College.

Investigators follow up on tips that arrive from caseworkers, public hotlines or automated systems that troubleshoot for suspicious activity, but Perry Wheeler, the president of the New York Welfare Fraud Investigators Association, told me, “When it comes to hotline calls, you’re looking at 2 or 3 percent of them are actually fraud. A lot of it is your neighbors are pissed at you or your relatives are pissed at you and they’re trying to get you in trouble.” Welfare recipients sign away many of their Fourth Amendment privacy rights when entering the system, allowing investigators to conduct undercover operations and stakeouts, or drop in unannounced to inspect a home with little probable cause. If signs of an unreported partner are seen, or if it looks like a recipient is operating any kind of under-the-table business, no matter how dire the underlying condition of poverty, investigators can make an arrest. Fastidiousness is highly incentivized: State coffers retain whatever portion of TANF block grants not spent assisting the poor and up to 35% of SNAP funds recouped from fraud investigations.

All suspects are given the opportunity to contest charges at an administrative hearing. Most waive it, if only to get the whole ordeal over with. A first offense usually leads to a six-month disqualification; it’s a year for a second offense, and a lifetime ban for a third offense. Restitution is an inevitable penalty, as are reduced benefits in the future, since few people can afford to pay back their debts outright.

Though fraud occurs in a minuscule proportion of cases, welfare recipients are made to live in constant fear of the criminal justice system. Applicants confront a menu of options, from school lunches to SNAP to Medicaid to Section 8 housing, and in each state, every program has different eligibility rules and different requirements for submitting information. Waiting in the wings are investigation units policing sub-regional jurisdictions with an array of enforcement tactics. The result is a system that, at times, can seem remote and inaccessible, and then, like in the case of David and Candice, fiercely personal. As Gustafson told me, “It’s Kafkaesque. You have offices and investigators with a lot discretion targeting an already stigmatized population.”

I’m thinking I’ll calm her down. She’ll go to sleep, and we’ll start anew the next day - David Heath

OKDHS determined Candice owed $20,100 in wrongfully collected food assistance. Over the next five months, Candice made a series of pre-trial appearances before Assistant District Attorney Richard Hull moved to indict. He offered Candice a plea deal of two felony charges, 10 years’ probation and no jail time. That was a relief, but during his investigation, Hull discovered Candice had received $35,000 of SoonerCare — the state-provided medical coverage for her three children. According to Hull, she defrauded that program as well, bringing the total amount of restitution to $55,000. Candice’s lawyer told her that she would probably face jail time if she rejected the offer. The couple couldn’t afford to fight the charges anyway, and the many court appearances had taken its toll on Candice. She was in bed for days at a time, often sore and short of breath. “My health won’t let me keep doing this,” she told David. “I know it. I feel it.”

In January 2012, Candice pleaded guilty to welfare fraud and making false claims against the state. The felony charges disrupted their lives in a number of ways. Candice’s criminal record dashed any chance of finding a job in health care. Someone would have to watch the kids when she checked in with her parole office. The local paper had reported her case, and a number of friends cut off ties. “Just depressed, depressed, depressed,” is how David describes his wife at the time. His burden of expenses now included $2,500 to the bondsman and monthly restitution payments between $300 and $400. If the couple failed to repay the $55,000 in a decade or less, Candice would be taken to jail.

Three weeks after her sentencing, David came home to find Candice particularly out of sorts. She was brusque with their youngest son, and complained about pain on her left side from her toes to her head. David tucked in the kids, while Candice turned in early. He was feeling slightly relieved, in the living room watching Full Metal Jousting, when she cried for him. David found Candice on the floor of their room, burning up and nauseous. He lifted her into bed, and asked if she could keep down an aspirin. She wanted him to rest with her. “I’m thinking I’ll calm her down. She’ll go to sleep, and we’ll start anew the next day,” David says.

He listened to her snore, but when he adjusted his arm beneath her, she groaned and said something about her chest. She heaved and went slack. Her eyes rolled back white. David searched for a pulse on her limp wrist. He tried CPR. “Whenever I breathed in it was like blowing into a piece of pipe that was blocked off at the other end,” he says. He threw her over his shoulder, and felt urine stream down the front of his shirt. Arriving at the hospital, David barked at the attendant to get her back. Doctors did chest compressions for an hour, hit her with three doses of adrenaline, and paddled her chest a half dozen times, before pronouncing her dead of a heart attack at 2:30 a.m. on February 23, 2012. She was 30 years old.

David and Patricia Coon both say that they believe Agent Comer’s investigation was a personal vendetta, and that the stress of the prosecution led to Candice’s death. She did misrepresent the information on her welfare application, but David asks, “Why not just cut the damn things off?” David, who says that he is caring for two of Candice’s kids while their father serves a prison sentence for dealing meth, worries OKDHS will transfer custody once he’s released. “I’ve come to love them like my own kids,” he tells me. For the time being, OKDHS informed him, as a single guardian of three, he might qualify for SNAP. “I don’t want anything to do with them,” David says. “I’ll just do it all by myself.” That might not be an option. A month after his wife’s funeral, OKDHS notified him that he still owes the agency $55,000.